Overview
The Business Solutions Team helps with your LLC entity formation by filing the LLC with the state, generating your Operating Agreement, obtaining your EIN with the IRS, submitting your S-Corp Election, connecting you with our business license research resource, and confirming your business bank account & initial capital stock contribution. Once these steps are completed, you'll move onto the Accounting & Payroll Onboarding Process.
Step 1. LLC Entity Formation
Once you've completed your Kick-Off Call, you will log into your Collective Dashboard to answer a few questions regarding your preferences for your new LLC. Important things to consider when filling out this information are determining your business name and business address. Your LLC should be set up in the state where the work is actually performed. If you work in multiple states, please see this article regarding Foreign Registrations.
Articles of Organization
Collective will apply for your LLC with your state to obtain your Articles of Organization. Depending on your state, the articles could be received right away, in a few days, or in a few weeks.
Once the articles are approved by the state, Collective will provide you with a copy of your Articles of Organization.
Registered Agent
Collective will assign our trusted 3rd party provider, RASi as your LLC's Registered Agent. You can view our article for more information on what a registered agent is.
Step 2. Operating Agreement
Once you receive the email notifying you that we've obtained the articles of organization, you will log back into your Collective Dashboard to complete your Operating Agreement. An Operating Agreement is a legal document that describes how your LLC will be managed and operated, we have a template you can e-sign.
Step 3. EIN (Employer Identification Number)
The EIN is also known as a Federal Tax Identification Number and is used to identify a business with the IRS. Once you e-sign the operating agreement, you'll click on step 3 to be prompted to start the EIN registration process. You’ll answer a few questions that will generate an SS-4 Form for you to e-sign. Collective will use this information to apply for your EIN online on the IRS website. The EIN is usually provided immediately after the application is submitted. Collective will provide you with the EIN number and a copy of the CP575.
Step 4. S-Corp Election (Form 2553)
You’ll receive an email to Sign your Form 2553 with instructions on how to complete the form for your S-Corp tax election. You will need to download and print the pre-filled form saved in your Company Documents on your Dashboard. You’ll need to provide a wet signature on both pages and re-upload the signed form to your Dashboard. Collective will fax the form to the IRS and will upload a copy of the fax confirmation.
Step 5. Business License
Once you receive the email notifying you that we've obtained the articles of organization, you will log back into your Collective Dashboard to confirm if you'd like our assistance with researching your business license requirements. You can choose to use our 3rd party provider, CSC to help determine what business licenses are required for your specific business or you can select the option to research the requirements on your own. You can view our article for more information about business licenses.
Step 6. Set Up Business Bank Account
Click on Step 5 to confirm if you'd like to set up a business bank account with our 3rd party, Mercury or if you prefer to open a business bank account yourself. If you select Mercury, you will be prompted to complete those steps with Mercury. Once you've opened your business bank account either with Mercury or with another bank, log back into the Dashboard to Confirm your bank account information, we will ask for your bank name and the last four digits of the bank account number.
Step 7. Initial Capital Stock Contribution
An Initial Capital Stock Contribution is a specific amount of money that you as a shareholder in your LLC would ‘contribute’ to get the business up and running. This can be a transfer from your personal account to your business account and can be any amount that you wish. Click through the steps to enter the amount that you contributed and the date. You'll then see the confirmation page that your formation process is complete
What’s Next?
You’ll receive another email to log into your dashboard to begin your accounting and payroll setup.
You’ll complete the setup for your Collective Accounting & Collective Payroll accounts and link your business bank account to our system.
We’ll register your business for payroll tax accounts (if applicable).
You’ll schedule a training call with one of our Onboarding Accounting Advisors. This call will be one-on-one and an excellent opportunity to ask questions about our bookkeeping process and confirm payroll is fully set up and ready to run.
Disclaimer: The information contained in this document is provided for informational purposes only and should not be construed as financial or tax advice. It is not intended to be a substitute for obtaining accounting or other financial advice from an appropriate financial adviser or for the purpose of avoiding U.S. Federal, state or local tax payments and penalties.